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COFFEE FUTURES 66
The
specialty
coffee market
1
MA Wheeler
“While overall world supply of coffee
is generally increasing, the available
quantity of quality coffee is not keeping pace with the growing demand for
quality. To the roaster, it seems as
though it is getting increasingly harder
to find really great coffees, in part because the existing supply is spread
more thinly among the roasters serving the growing demand for them.” [K
Easson 2000]
“Unfortunately, the specialty or gourmet market has suffered from the fact
that some suppliers are paying only lip
1
service to the original vision. Thus,
the concept has been downgraded
with some aspects of the specialty
coffee business now obeying the
price trends of a commodity market.”
[K Muir 2000].
6.1. INTRODUCTION
The term “specialty coffee” originated
in the USA and was initially used to
describe the range of coffee products
sold in dedicated coffee shops, in or-
Largely abridged and adapted from the Gourmet Coffee Project Report (ICO/ITC/CFC)
May 2000
der to differentiate these from coffee
generally available through supermarkets and other retail outlets. It refers
to both whole bean sales and to coffee
beverage sales in coffee bars as opposed
to restaurants and other catering establishments.
The specialty coffee range included
higher quality coffees, both single origin and blends; unusual coffees such
as flavoured coffees and coffees with a
notable background/story attached to
it in some way. However, with the rapid
growth in the number of specialty coffee retail outlets and more particularly
the expansion of the specialty coffee
product range into more mainstream
outlets such as supermarkets, the term
has become much looser. The term
specialty coffee has, therefore, become
a generic label covering a range of different coffees, which either command
a premium price over other coffees or
are perceived by consumers as being
different from the mainstream brands
of coffee widely available within a
country or region. Consequently the
term has become exceptionally broad,
so much so, that there is no universally accepted definition of what constitutes “specialty coffee”, indeed it frequently means different things to different people. Given this lack of precision in definition it is extremely difficult to describe the market in a global
way and the best approach appears to
be to look at the speciality market from
different country or regional viewpoints.
The very notion “gourmet” or “specialty” suggests some degree of exclusivity. It is unlikely that one could market thousands of tonnes of a particular
quality, and still call it “exclusive”. The
first lesson to be learned therefore is
that one should not “overdo it”. The
first observation is that producers need
to “target” any special coffee very carefully because the term “specialty” covers a large and growing number of different products, each of which has its
own “niche”.
Niche markets: a “niche” combines a
set of conditions which enable a single
species or a single product to thrive
within the greater ecological or commercial environment. Whilst much of
global coffee production consists of
industrial type coffees, there are many
other coffees (often of limited availability) with greatly varying taste characteristics which appeal to different
groups of consumers, and which sell
at a premium over industrial coffees.
Simply put, where the producer/exporters of such a coffee and such a group
of consumers get together, a niche market is created. Two main factors determine whether a coffee can find a niche
market: quality and availability.
“Quality” is a subjective term which
means different things to different
people. Of course there are a number
of fairly common denominators but, to
give an example, the somewhat bitter
taste of Liberica is not liked in most
markets, yet it is greatly appreciated
by some. Acidic, flavoury coffees find
ready takers in Germany but not so in
Turkey. In the end it is the consumer’s
perception of “quality” which makes a
coffee special or not.
6.2. THE USA
In 1999/2000 the United States imported approximately 21.7 million bags
of coffee. Based on earlier estimates
by the SCAA (The Specialty Coffee Association of America http://
www.scaa.org/, see Box 6a), specialty
coffee probably accounts for around
17% of total annual imports, which
would equate to roughly 3.7 million
bags. Not all of the specialty coffee
imports are green coffee however, as
significant volumes of decaffeinated
and roasted coffee are imported from
Europe as well. The share of specialty
in green coffee (defined as SCAA class
1 or class 2) represents between 14 and
15 percent of total imports or about 3
million bags.
It is probably true to say that the US
specialty industry can trace its roots
to the relentless drive to profitability
and market share of the post war era,
so ably led by the supermarket chains
where epic battles were fought between
bulk roasters to obtain “shelf space”.
In many instances coffee was used as a
loss leader, generating energetic
searches for the cheapest grades of coffee that the US health authorities would
permit to be imported, and for methods to increase the number of cups of
coffee to be drawn from a single pound.
The latter then culminating in technical innovations which even increased
the yield from the simple coffee bean
itself and, supposedly, enabled one to
deliver the same cup quality from a
lower quality of coffee (Prendergrast
1999).
A combination of consumer revolt,
combined with clever assessment of the
marketing opportunities this offered,
led to the birth of the specialty industry or, if you like, a “back to our roots
= a decent cup of coffee” movement.
Beginning with the small “purists” in
their corner stores, the subsequent rise
of the major chains in the specialty
industry and the distribution of these
coffees into grocery stores, has forced
the industrial bulk roasters to rethink
their product mix in a way that has
definitely enhanced the overall quality of coffee in the US compared to two
decades ago!
It has been a dynamic movement and
amongst several trends facing the specialty coffee industry, the major trend
is the competition between, and the
separation of the marketplace into, the
‘Big and the Small’. The SCAA considers there are approximately 15,000 active specialty coffee retailers in the U.S.
Of these half would be classified as
coffeehouses with the others falling
under retail stores, kiosks, espresso
bars or mobile coffee carts. A coffeehouse has seats and at least 30% of its
sales consist of beverages. The usual
sales mix for these coffeehouses is
about 50% beverages, 15% whole bean
COFFEE FUTURES 67
COFFEE FUTURES 68
BOX 6a. What SCAA says
Quotes from “Looking to the Future: Visions for the Next 10 Years” April 16, 2000, 12th Annual SCAA Conference, San
Francisco http://www.stoneworks.com/scaa1_archive/voodoo.html
“I believe that by the year 2010, the entire industry will know and believe and be acting on the fact that quality of life and quality
of coffee are essential for each other.” [Paul Katzeff; CEO of Thanksgiving Coffee President of SCAA 2000-1]
“When we began, large roasters who gratified the consumer’s desire for cheap coffee by reducing the quality, decreasing the brew
strength, and increasing marketing expenditures dominated the American coffee business. We brought little knowledge and little
money, but we had passion and principle. And we have changed the coffee world.” [Jerry Baldwin; Chairman of Peet’s Coffee and
Tea, Inc.]
“Let’s face the facts: a large quantity of specialty green coffee is not special at all. Defects of ferment, hard cup, over-ripe fruit, low
altitude, and many others are ignored because of ignorance or misrepresentation.
Stale coffee is not special under any circumstances. And very little specialty coffee is sold fresh, that is, within a week of roasting.
You could construct a modern auction system for coffee that rewards the farmer for real quality and altitude, while it ignores
marketing exaggerations. Such a system would increase the price of the best coffee, and it will reward quality and dampen the
effects of fluctuating prices.” [Dan Cox; President, Coffee Enterprises, Inc.]
“I believe that the definition of Specialty Coffee will be seriously challenged. As the trade grows in mass, gravity will exert its force
in an attempt to push standards down to a lower common denominator elevation. It will require a determined effort to uphold the
quality standards that define specialty and moreover to distinguish it from what is not genuine specialty coffee.
Along the evolutionary path of any growing industry there is a natural tendency for a few players to emerge as size dominant
operators. This is brought about by their own unique abilities to achieve efficiencies and abilities to effectively harness the dynamics of the moment. They will play an important role in expanding the entire size of the trade and thereby creating more opportunity.”
[Martin Diedrich; Diedrich Coffee]
Specialty coffee has a huge opportunity to make a difference in the world. As an industry we touch so many people – consumers,
growers, workers. Specialty coffee IS a vehicle for change. We can empower the consumer to make a difference with their purchase
dollars. We can empower growers to have livelihoods that respect them and their dignity as human beings. [Kimberly Easson;
President of JavaVentures]
“...when I first got into the coffee business about 25 years ago […], coffee was a lost leader in supermarkets, packaged stale in
vacuum cans, roasted far too light, quenched with so much water that the cans rusted on the inside. Indonesian robusta was selling
at 15 cents per pound ex doc and buyers who would take all the beans, twigs, sticks, dirt that you could deliver at that price. Things
have obviously changed but despite the massive proliferation of espresso machines, specialty stores, carts and kiosks, it is still
much easier to find a mediocre cup than a good cup and it is still rare to find a Great Cup.” [Robert Fulmer; President of Royal
Coffee]
“…. I’m speaking from a grower’s point of view. For a coffee producer, the term specialty immediately refers to better quality and
therefore, hopefully a premium. The problem however, is that the premium is usually not real. Take the present crop for example.
Coffees that used to be sold at premiums well above the New York C market are being offered at near level or below level prices.
A special product is not something you find easily. I believe that special coffees are very limited and therefore these coffees should
be handled apart from the New York C market. Good quality coffee is not necessarily specialty coffee. Specialty coffee for me is a
coffee that has a special distinction besides quality behind it. The best definition of specialty coffee that I can find, is that of a coffee
grown in a specific region, cooperative or farm, with a special history to tell to the final consumer. If added to that you have great
quality you have found specialty coffee. Since that is not easy to find and will be even more difficult in the future, we should not
worry about how we can handle this limited volume separated from the New York C market. We are talking about a finished product
with limited availability, not a commodity.” [Roberto Giesemann; CEO for Café Ecex 2000, Mexico]
“I think the quality trend in the specialty coffee sector is down. This is partially due to the aggressive and widespread introduction of
super hybrid coffee trees over the last 15 years which benefits yield at the expense of cup quality. The situation has been further
aggravated by the compromises made by many on the consuming side by putting price ahead of quality. The growth and success of the
specialty industry has attracted many participants both at source and in the US market who have decided to take advantage of the
higher prices that the name “specialty” can obtain without backing them up with the quality that it signifies. The quality of single origin
coffee available to the consumer has declined over the last 10 to 15 years. Are we now falling victim to our own success? [Roland Veit;
Chairman of Paragon Coffee Trading Co.]
coffee, 30% food and 10% other. The
large chains account for 70% of the
business. Examples of these would be
Starbucks, Diedrichs Second Cup,
Barnies and Caribou.
Over the past few years the large retail
coffee chains have grown exponentially. Often this expansion has been
by the purchase of existing regional
coffeehouses. More often however, the
chains have simply opened up their
stores in every conceivable and potentially profitable location across the
land. Many of these new locations have
been relatively close to, if not right next
to, an already existing smaller coffee
retailer.
These larger coffee retailers have developed a brand awareness for themselves, which is as recognizable as
some of the major international fast
food chains. Their coffee products, for
the most part, are exactly the same
from store to store. Their individual
stores all have the same look and feel
and their marketing materials, signage
and logos are all consistent with a national image. Each large company presents a unique product line and image
but within the company everything is
the same.
This expansion and consolidation with
ever fewer retailers controlling more
of the specialty business is a cause for
concern within the industry. The ability to focus on small, unique plantations or areas becomes increasingly
harder as a retailer gets larger. The
likelihood of a large retail chain moving to centralised distribution of certain coffees becomes greater. This
move away from the emphasis on a
multitude of coffees, each with their
own variable and unique flavour profile, to an emphasis on marketing a
branded blend is obviously changing
the nature of the traditional specialty
store.
An interesting trend, as Box 6a attests,
is the increasing linkage between specialty coffee and sustainability and so-
cial issues. SCAA discusses important
issues in an admirably open way and
it is clear that some and perhaps many
SCAA members have strong social
convictions and promote their product
along these lines. Whether this leads
to sustainably higher prices for the
farmer is not so clear however. It may
be that as specialty coffee is becoming
a bigger business, some roasters are
looking for other attributes to boost
their sales which from some of the discourse at least, is beginning to sound
more like the “Fair Trade” mantra.
Whatever the current problems however, the specialty coffee industry in the
US has achieved rapid and spectacular growth and, because of the curiosity and awareness it has created, and
will continue to create, the general
opinion is that this market segment will
continue to grow. The growth prediction from some industry leaders is that
within the next 5-10 years the specialty
market will grow by at least a further
million bags. The SCAA predicted in
their “Operation Rebound” report that
by the year 2022 the demand for specialty coffee would more than triple to
9.4 million bags. This assumed that the
total U.S. coffee market will grow to
31.5 million bags with specialty representing almost 30%. Time only will
tell whether these assumptions are realistic but the 1999 National Coffee
Association’s survey concluded there
are 21 million daily drinkers of specialty coffee in the US.
6.3. EUROPE
Generally speaking, specialty coffee in
the European sense refers to a gourmet or quality coffee from a named
origin that offers the consumer a particular desirable flavour characteristic.
This is not to say that specialty or gourmet coffee excludes all blends, it does
not, indeed most espressos, which fall
into this category, are blends; but with
the exception of espresso, specialty or
more correctly “gourmet” coffees, are
generally considered to be single ori-
gins. However, the absence of a universally accepted definition of what
specialty coffee is, makes it difficult to
distinguish this sector from the mainstream, especially as many of the
brands on sale in Europe are based
upon single origins or are blends of
some of the finest coffees available.
The situation becomes even more confused since many see the specialty coffee sector as referring exclusively to the
new US style cafés and coffee bars
which are expanding at a fairly rapid
rate through many European towns and
cities. These cafés sell a wide variety
of different coffee beverages generally,
although certainly not always, based
on espresso. The sector has, by and
large, been characterised by the growth
of relatively small operators, involving one or two stores per company,
similar in many ways to the early experience of the sector in America.
Larger chains however, are now beginning to emerge, with names like
Starbucks a common sight today
throughout the UK and now entering
mainland Europe. Indeed Starbucks
has recently announced that it intends
opening as many as 500 retail outlets
within Europe by 2003. A number of
the more traditional coffee shop chains,
like Tchibo in Germany, have repositioned themselves within the market
place in order to take advantage of the
current boom in specialty coffee, although they have always operated
specialist coffee shops.
Many of the smaller newer coffee bars
and stores also sell roast and ground
and whole bean coffee as well as cups
of coffee, although this has generally
been bought in from a specialist roaster.
But this is not always the case, as there
has also been a revival of interest in instore roasting, although in many cases
local environment laws prevent roasting on premises within shopping centres or malls.
The coffee industry in Europe is firmly
rooted in both history and tradition and
as such consumers tend to be fairly
COFFEE FUTURES 69
COFFEE FUTURES 70
conservative, almost reluctant to embrace new concepts with the same degree of enthusiasm as is frequently seen
in America. However, there can be no
doubt that the new tend towards the
specialty sector is being spearheaded
by the young who clearly associate specialty coffee with American, or probably more accurately, modern culture.
The markets in Europe where the specialty sector is growing the fastest include the UK, Spain, the Benelux countries (particularly the Netherlands),
France, Germany and Scandinavia. In
all of these countries there has been a
rapid proliferation in the number of
new style coffee bars and boutiques.
These have promoted the concept of
espresso based drinks, a trend which
has been accelerated by the introduction of high quality reasonably priced
home espresso machines. There have
also been important developments in
the specialty soluble sector, which in
many cases has been centred on the
popularity of single portion soluble
coffee products such as cappuccinos
and flavoured coffee drinks. In some
countries, like the Netherlands and
Germany, these beverages account for
over 5% of total supermarket soluble
coffee sales. In the more traditional
markets, such as Scandinavia and Germany, the specialty sector is also showing strong growth, particularly with
products such as organic and fair trade
coffees, special decaffeinated coffees
and single origin and estate coffees.
Despite the rapid growth that has been
achieved in the specialty coffee sector,
the continuing concentration of buying power into the hands of a small
number of roasters, has not made it
easy, especially over the past decade,
for small producers to add value
through improved quality or promotion
in Europe. This is because in most
cases their production is insufficient to
be considered for sale as a straight origin coffee by the larger roasters who
require a significant quantity to be assured, in order to launch a brand Europe-wide. In this regard the emer-
gence of a specialty trade in Europe
can be seen as positive as it provides
the opportunity (albeit limited) to
smaller origins to find the perfect niche
through which their best qualities can
be sold as single origins. But given
the presence of so much good quality
coffee throughout Europe, the specialty
market for roasted coffee as opposed
to the market for high quality liquid
coffee, will always be a fairly small
niche market segment where probably
only the true enthusiast will hope to
find something different. This is a different scenario from the US where the
growth of the specialty sector is based
on the large number of people who are
disappointed with the coffee which
was/is available from the larger roasters.
Furthermore, the larger roasters in Europe have not ignored the growth of
consumer interest in specialty coffees
and have been innovative in catering
to their requirements. It is not unusual
to find at least 6 and in many cases
even more, single origin roast and
ground coffees from the major roasters on the shelves of a typical supermarket together with the more traditional blends. Even the soluble sector,
particularly in the UK but elsewhere
as well, has recognised the importance
of the specialty coffee sector in Europe
and has developed not only single origin soluble coffees, but also instant
cappuccinos, soluble espresso and
other niche market coffee products. As
a result, the competition between the
major brands and the small specialty
roaster limits the latter’s potential market as both are effectively competing
for the same market.
6.4. JAPAN
Although the Japanese coffee market
is becoming more sophisticated, it is
not really possible to really speak of a
clearly defined specialty or gourmet
market yet. This is because the term
“specialty or gourmet coffee” is still
fairly new to the Japanese consumer,
although this is changing, as the range
of coffees and qualities available becomes wider. Even so, many of the
coffees sold under a gourmet label remain more impressive in terms of their
names and catchy slogans than in
terms of cup quality.
The Japanese specialty coffee market
can be compared to the specialty market of the US, in that there are a number of distinctive segments, which can
be easily identified. These are;
§ Coffees sold purely on the strength
of the name or their reputation, These
coffees have an almost mythical reputation, such as Jamaican Blue Mountain or Hawaii Kona. These are good
coffees, the appeal of which is virtually impossible to match, certainly
within the short to medium term.
§ Coffee with an excellent reputation
and image, primarily excellent qualities, single origin, estate or area coffees
such as PNG Sigri, Costa Rica Coral
Mountain, Colombian San Agustin,
Mexico La Taza,
§ Well publicised decent standard origin coffees, such as Colombia Emerald Mountain, Mexico Monte Alban,
Colombian Santa Marta, etc.
§ Branded blends, such as Nittoh
Coffee’s Special Brazil, Arab Coffee’s
Special Washed Java Arabica, World
Coffee’s Guatemala Antigua, etc.
However, unlike the US there are no
dedicated specialty importers, although
most importers handle at least some
specialty coffees and increasingly service smaller downstream buyers directly.
There is, however, a network of dealers/wholesalers, which service small
and very small retail roasters. The industry is extremely competitive and
margins on commercial qualities of
coffee are relatively narrow.
Many importers and dealers are therefore looking to the better quality gour-
met coffees to provide more attractive
margins and in so doing are forcing
more and more roasters to seek alternative sources of supply.
6.5. DEVELOPING A
SPECIALTY COFFEE
So far we have dealt with the consumer
country end of specialty coffee, but
what of the producer end? A recent
experience is provided by The
Gourment Coffee Project.
The Gourmet Coffee Project (19972000) was launched by the ICO, the
International Trade Centre (ITC:
UNCTAD / WTO) and the Common
Fund for Commodities (CFC). The object was to increase earnings of the
coffee producing countries and reduce
their economic vulnerability. This to
be done through the stimulation of production of better quality coffee (gourmet) and effective marketing. Space is
limited, so we deal here with a case
history, of an attempt to develop a specialty coffee in one of the poorest countries on Earth:
fee business) has constructed 133
washing stations around the coffee area
to provide local access. But even so the
steep terrain means that cherries are
delivered to the stations on foot; growers harvest in the morning and walk
up to 7 km in the afternoon to deliver.
The trip is so arduous that few take the
pulp back to use as mulch. Only red
cherries are accepted. In 1999, 60% was
fully washed. Almost 100% is exported
to Europe. Bean size is small but appearance is attractive and the taste
mild. Producer prices are stabilized by
a Stabilization Fund.
The rationale for the project was that
a shortage of suitable land suggested
that Burundi could only add value to
the industry by increasing yield and
quality. Burundi coffee had essentially
stagnated into fixed trading patterns
where it was accepted as a useful but
not necessarily essential element of
European coffees. Burundi was thus
trying to break out of a ‘glass ceiling’
and was minded to target new markets
in the US and Japan.
In Burundi, most coffee is grown between 1500 and 2000m above sea level.
It is estimated that 800,000 people
grow at least some coffee. On average
each farmer may have only 150 trees,
but this provides him with his only cash
income. The coffee (nearly all arabica)
is grown on steep hillsides and helps
to prevent soil erosion. All work is
done by hand and mulching materials
are scarce. Burundi produces traditional semi-washed (called ‘Washed’
and is pulped by hand pulpers) and wet
processed at washing stations (Fully
‘Washed’). Coffee, nearly all arabica,
comprises more than 50% of all
Burundi’s exports.
Thanks to 10 years of records, OCIBU
central laboratory had a good idea of
coffee quality from each area, so this
data was used to select the most promising area from which to build up a specialty coffee. Washing stations involved agreed to separate the best quality parchment for the project. But
growers and stations would continue
to receive the standard seasonal price
for cherry and parchment respectively.
Whether they would share in any market premiums would depend on the end
result. It was agreed that the project
steering committee would be able to
manage both sale and export and bypass the standard auctions. They found
that there was considerable variation
between washing station outputs with
some good quality coffee but this was
being diluted as these coffees fed into
the main pool.
OCIBU (Office du Café du Burundi, the
official body that coordinates the cof-
A principal problem turned out to be
obtaining sufficient quantity of the
The Burundi Ngoma mild specialty
case history:
right quality because few operators in
the chain were exposed to appreciable
risk. So generally there was a lack of
appreciation for quality throughout the
chain and limited reward for producing it.
The steering committee concluded that
the issues were:
§ To identify and present the right export quality.
§ Reward those producing quality.
§ Engage in the promotion necessary
to break through the price ‘glass ceiling’.
They needed to contact growers but this
was difficult because no growers’ associations existed. Hence the washing
station was the focus of contact. A
number of ‘grower messages’ were prepared by OCIBU’s staff on selective
harvesting and handling. Station managers were tasked with improving
cherry selection and station procedures. Detailed records were kept of
who delivered what quality of cherry,
though no additional payment was
made because funds were lacking for
up-front payment. In the end it was
mostly station operators that were contacted by project staff; so dispersed and
overworked were the farmers deemed
to be, that it was considered inappropriate to draw them together when so
little could be promised them.
The weaknesses of the system were
therefore clear: the authorities set a
single price for cherries suggesting that
all cherries are the same. The volumes
received were often so small that grading and rewarding would be subjective.
A second payment at the season’s end
was theoretically possible but difficult
to separate rewards to individual stations, and individual rewards to farmers would be very small.
Samples were sent to SCAA and the
All Japan Coffee Association (AJCA);
only approved coffees would be offered
for sale.
COFFEE FUTURES 71
COFFEE FUTURES 72
The first harvest of 1998 ran into many
problems, a) bean size was small, due
probably to inadequate husbandry, b)
the washing stations were not adequately separating light and heavy
parchment, c) the mill used to process
the beans, could not treat individual
batches, d) the accurate grading, density separation and sorting necessary
to produce high quality was not available.
Thus the decision was taken in 1999
to use a private mill which could
handle small batches. The results were
still mixed, with some parchment better than the previous year but in other
parts lower, due to climatic and management issues. The main problem was
that quality control at washing stations
was still poor, mainly due to lack of
financial stimulus to improve things.
The upshot was that about one third of
the beans produced had to be rejected
because of poor size or weight. Hence
coffees from the same area had to be
bulked to get enough together for a
shipment. Overall the premium gained
was insufficient to cover the extra costs
of selection and rejection of such a
large quantity of beans, so the technology available to the small-holder was
not capable of delivering the primary
quality needed to construct a specialty
coffee.
Despite all this, 17 lots, ranging from
91 to 300 bags, were prepared and
sampled to tasting panels and potential buyers in the US and Japan. Comments included,- US: “7.1 to 6.5 mm,
excellent to good cups, gourmet/specialty but not necessarily ‘stand-alone’
coffee.” Japan: “7.1 to 6.5 mm excel-
lent preparation, excellent to good
cups.”
The project staff wondered about replanting to get better quality, but this
was rejected as too difficult and risky,
it might detract from the normal European market characteristics and fail
to capture a specialty niche.
In February 1999, 33 tonnes of the
1998 harvest were sent to Japan, where
it was well received despite being past
its prime. It was officially called
“Ngoma Mild”. Later in the year 68
tonnes of the 1999 crop were exported
and obtained differentials of 30 to 45
cents per pound.
The outcome of all this is that the Japanese seemed to take to the coffee
more than the US where some quality
BOX 6b. A Colombian community trying to develop a specialty coffee
Vereda Jazmín, near Altagracia, Risaralda, Colombia has about 300 farmers and over 1000 ha of coffee; they farm little
else apart from coffee. Their growers’ association, the Federación de Cafeteros de Colombia, has told them that in their
area, the micro-climate, soils, altitude and preliminary cupping tests all suggest that they can produce a product of
interest to the specialty market. For an initial trial 33 fincas (farms) have been selected. I attended one of their first
meetings on 9th April 2001. The meeting was in the Federation’s cooperative in Pereira, an impressive three story
building. The farmers were given a lecture on the extra care needed to produce the specialty coffee, including correct
fermentation time, selection for size, careful drying to avoid any blemishes. Some farmers took notes.
Later they were invited to taste their own coffee samples prepared by an expert in coffee tasting. The coffee is ‘clean’
with medium acidity and body and possesses floral notes. “The difference between coffee farmers and wine growers is
that the wine grower knows what his wine tastes like, the coffee grower doesn’t” said a presenter, the Federation’s
specialty expert Dr Gustavo Esguerra. He wants his farmers to become like wine growers, and he wants 10% of
Colombian coffee to be “specialty” within 5 years.
Most of farmers attending seemed interested, but they know it will not be easy. One large farmer of the group had
looked at the possibility of doing this as a private venture, had looked at US companies on the web, but the cost of
hiring a container, transport, insurance etc. is very high. The volume needed is not trivial; to make it worthwhile, they
will have to export at least 50 tonnes of coffee to interest a buyer in the USA. And the premium they receive might not
be very high. Some coffees, explained Esguerra, can command very high prices but it is difficult to launch a new coffee.
Fixing an initial price is tricky, too high and no one will buy, too low and it is frequently difficult to raise the price
further.
The farmers of Jazmín are feeling hard-pressed by chronically low prices, but they seemed committed to trying a
specialty venture; they will send small amounts to the Federación to start with. They will monitor the quality to see if
it is sufficiently high and consistent and that the taste remains stable from harvest to harvest They are building the
marque slowly, if results are promising they will then try to produce the quantity necessary.
One farmer wondered if it was worth the trouble, ‘Can’t we get into this Fair Trade scheme?’ he asked, he is experimenting
with roasting and blending his own coffee to sell locally.
[From field notes by PS Baker, 10.04.01].
problems arose and where doubts were
expressed that it was special enough.
But enough goodwill and understanding of the difficulties of bringing this
coffee to market was shown by both
US and Japanese specialty groups to
encourage Burundi to continue with the
marque.
The fundamental difficulty of this case,
seems to reside in the poverty of the
growers who have scant resources and
lack of incentive to protect or improve
the quality of their cherries.
§ Market messages must reach individual washing stations and producers.
§ Unless Burundi “individualises” at
least its best coffees, the industry will
remain a price taker, subject to a definite “price ceiling”.
§ The Burundi industry must adapt to
the market reality, which is that as a
small producer, the country’s only
weapons are quality, agility and flexibility.
This means that there is not enough of
a safety factor, say, when the rains are
lighter than usual, or when a washing
station gets overloaded, to easily
achieve an acceptable standard. The
market demands not only quality, but
consistency from year to year.
6.6. CONCLUSION
Some final recommendations of the
project:
Despite the fact that the term ‘specialty
coffee’ lacks a precise definition and
The reader is invited to compare these
efforts with a short account of another
specialty coffee attempt in Colombia
(Box 6b).
has developed differently in different
countries and regions, there is clear
evidence to suggest that consumers
have embraced and endorsed the development of the specialty coffee sector.
Consumers appear to be better informed about the whole notion of better quality coffee, although this has not
been empirically proven, but they are
demanding greater differentiation in
the coffee products they buy.
The new style coffee bars and boutiques, often selling milk based coffee beverages, which are often disapproved of by coffee traditionalists, are
nevertheless performing a vital function for the coffee trade in introducing young people to the joys of coffee
consumption. This is a movement which
has revolutionised the coffee industry,
the impact of which, has been extremely
positive, and all the indications suggest, should be long-lasting.
6.7. BIBLIOGRAPHY
Easson K, 2000 The (R)evolution of Quality. Tea & Coffee Trade Journal. 172 No. 2.
The Gourmet Coffee Project, 2000 A joint project of International Coffee Organization, International Trade Centre & Common Fund
for Commodities.
Muir K, 2000 Coffee: facts of fiction? FO Licht’s International Coffee Report. 15: 49-51.
Prendergrast M, 1999 Uncommon Grounds: The History of Coffee and How It Transformed Our World. Basic Books; 525 pp
COFFEE FUTURES 73
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